New York City hotel update

18 March 2012

Occupancy rates at New York City hotels averaged 85.3% across 2011, year-end figures from NYC & Company have revealed. This represents over 27 million room nights sold across the five boroughs of Manhattan, Brooklyn, Queens, The Bronx and Staten Island.

Demand for January and February 2012 was buoyed by inbound international travel, strong attendance at conventions and trade shows and a mild winter, with PKF reporting January 2012 occupancy at 71.7%.

Strong occupancy rates in New York City have been matched by a period of rapid hotel development in New York City. Between January 2006 and December 2011, the city underwent its fastest and most successful hotel building boom on record. In the two decades proceeding this period, the average annual increase in net inventory was a mere 1.1%. In more recent years, the year-on-year net gains were +2.7% (2008 vs 2007), +5.8% (2009 vs 2008) and +5.0% (2010 vs 2009). In 2011, the net increase in room inventory averaged over 5%. Looking ahead to 2012 to 2014, the city is poised to add another 6,200 rooms bringing the total in active inventory to 96,000 (another 7% increase in inventory).

Recent openings in New York City include the TRYP by Wyndham, The Out NYC and a new build Holiday Inn in Midtown as well as the reflagged and expanded Hilton at JFK Airport. Notable openings on the horizon include The Conrad New York, adding 463 rooms at the end of March; the NoMad in the Flatiron, also in March; Hotel 718 and the Wythe Hotel, both in Brooklyn; and the Wyndham Garden Hotel in Queens.

2012 will see the continuation and expansion of important investments in renovations and redesign to improve the visitor experience. In addition to projects at the Sheraton New York, The Roosevelt, The Moderne, the Grand Hyatt and the two Fitzgerald Hotels which are complete or nearing completion, NYC & Company is also looking forward to changes at the historic Algonquin Hotel (reopening in spring 2012), The Cooper Square Hotel, the Loews Regency Hotel, the Giles Tuscany Hotel (reopening in late 2012), the New York Palace and the iconic Milford.

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The outlook for NYC hotels remains dynamic. Recent analyses by NYC & Company and STR highlight a key dynamic in the new development: the expansion of hotel properties throughout all five boroughs of the city. On average, over the period 2006-2011, 40% of the new hotel properties were built in neighbourhoods and business districts outside Manhattan. This represents approximately 7,500 additional hotel rooms in Queens, Brooklyn, The Bronx and Staten Island.

This information is extracted from NYC & Company’s Hotel Development sheet prepared for the travel trade during ITB 2012 to assist in planning and product development. Please find the complete report, including further details on future developments, attached here. Information may be subject to change.